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I have a question, probably a silly one for all the experienced Oracle DBA's but i am novice so forgive me if i asked a silly question. I just entered the world of oracle database administration from Ingres (????).

My question is "Do we have to have the same passwords for SYSTEM and SYS for both production and test database, when we are replicating a database from archive logs?. I am asking this because, we are actually applying the archive logs from the production database to the test database on an hourly basis. so does it require the passwords of test database SYS and SYSTEM be the same as production database SYS and SYSTEM or can they be different".

No need to be the same passwords for replication/applying logs. I don't know howz your setup for this process, Worst case you might need to give the hard coded passwords (can be different from one machine to another) in the script you use to maintain, manage and apply your archive logs from one machine to another.

SYS and SYSTEM Passwords for production and test databases

Here is the process which we are following.
1) We are receiving the archive logs through a 3rd party ftp software (FASTCOPY) then on an hourly basis we are moving them into the archive log destination directory.
2) Then we are shutting down the database and starting it in nomount state.
3) once it is in nomount state we are issuing the command "alter database mount standby database" and then issuing the command "recover standby database" with AUTO.
4) Once the applying of the logs are done we are altering the database to open read only.

So basically it is not replication but applying of logs from production to the test machine.